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Investigations

FHWA Suspends DBE Contractor for Role in Pass Through Scheme

On March 31, 2016, FHWA suspended and proposed the debarment of Joyce Abrams and Markias, Inc. based on a February 2016 OIG referral. At that time, the U.S. Attorney’s Office in Philadelphia filed an information charging Abrams with conspiracy to commit wire fraud in a scheme involving DOT’s Disadvantaged Business Enterprise (DBE) Program and work performed on two federally funded bridge renovation projects. Abrams was the president and sole owner of Markias, Inc. (Markias), a now-defunct certified DBE.

Abrams pleaded guilty in February 2016 and admitted that Markias served as a pass-through and did not provide a commercially useful function. Markias served as a front company to give the appearance that the contractors met the DBE requirements on both of the federally funded bridge projects. In turn, PennDOT falsely credited approximately $3.2 million in DBE work on the Girard Point Bridge project and approximately $1.2 million in DBE work on the 30th Street Station project. Abrams received a fee, on both projects, of 2.25 percent of the face value of the supply invoices processed by Markias to act as a pass-through.

In addition, Abrams admitted that the joint venture subcontractor on the 30th Street Station project ordered materials for use on out-of-State projects but had the related invoices delivered to Markias. She then issued Markias invoices that made it appear that those supplies had been used on the 30th Street Project in Pennsylvania. Those false invoices caused the prime contractor to falsely report to PennDOT that the supplies actually delivered to and used on the out-of-State projects qualified for DBE credit on the Pennsylvania projects.

Note: Exclusion actions (suspensions and debarments) are frequently for a specific period of time and the System for Award Management (sam.gov) should be consulted to find whether a company is currently excluded.